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Canadian Crystallex to pursue assets from Venezuela's PDVSA Citgo - U.S. judge

 

 

 

By Jonathan Stempel

NEW YORK
Petroleumworld 08 24 2018

A U.S. judge has formally granted a Canadian company the right to go after prized U.S. assets belonging to Venezuela, to satisfy claims from a 2008 nationalization of its gold mining operations in the now cash-strapped South American country.

U.S. District Judge Leonard Stark in Delaware on Thursday granted a so-called writ of attachment to Crystallex International Corp in shares of Citgo Holding, which owns a U.S.-based oil refiner controlled by state-owned Petroleos de Venezuela SA (PDVSA).

Stark also imposed a temporary stay on Crystallex enforcing the writ to give other parties a chance to weigh in, including possible appeals.

The judge had ruled on Aug. 9 that Citgo Holding assets were subject to attachment. PDVSA said it would appeal.

Other companies may also lay claims on the assets, and the writ's issuance does not mean Crystallex will take over Citgo and run its refineries.

On Wednesday, lawyers for Rosneft Trading SA, a unit of Russia's largest oil company, which owns a 49.9 percent security interest in Citgo Holding, filed a letter urging a hearing on how to “structure a robust appraisal and sale process” for the shares.

Holders of PDVSA bonds maturing in 2020 controlled the remaining 50.1 percent security interest, the Rosneft lawyers said.

Lawyers for Crystallex and Rosneft did not immediately respond to requests for comment on Thursday.

Crystallex has been seeking to collect $1.4 billion it claimed to have lost a decade ago, when Venezuela nationalized its gold mining operations under then-President Hugo Chavez.

OPEC member Venezuela has few offshore assets, which has encouraged creditors such as Crystallex to pursue Houston-based Citgo, its most valuable asset outside the country.

Stark said PDVSA should file a motion and post a bond if it wants to stop Crystallex from enforcing the writ, but can still appeal if it loses the motion or cannot post the bond.

A lawyer for PDVSA did not immediately respond to requests for comment.

The case is Crystallex International Corp v Bolivarian Republic of Venezuela, U.S. District Court, District of Delaware, No. 17-mc-00151. ()

________________________

Story by Jonathan Stempel in New York, Editing by Rosalba O'Brien from Reuters.

reuters.com
08 24 2018


 

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